The EUR/USD downtrend channel managed to break below the round level of 1.20. Price could now use the resistance line of the bearish channel for a continuation. A bearish bounce could see price fall towards the Fibonacci targets of wave 3 (green) whereas a bullish breakout could indicate a bigger retracement.
The EUR/USD could extend the bearish wave 3 (green) towards the Fib targets if price stays in the bearish channel. A break above the channel could see price move towards the retracement levels of wave 4 (green). A break above the 50% Fib of wave would make this wave pattern less likely.
